Many Arlington car dealerships are struggling to stock cars amid a nationwide shortage of computer chips.
At Mercedes-Benz of Arlington in Ballston, formerly known as American Service Center, a lot once stocked with around 130 used cars available for sale has emptied out to 63 vehicles, according to Ron Moghisi, who manages pre-owned sales. He said many of the cars were purchased at nearly 30% over the normal list price.
“There’s a lot of demand, but there’s just nothing for us to buy and to resell, because the price is so high that it won’t make sense,” Moghisi said. “Let’s say you buy a bicycle for $10 that you can sell for $12. It doesn’t make sense to buy it for $16, because you’re going to get stuck with it. Some dealers are taking the risk and buying them, and God help them.”
Employees at the Koons Arlington Toyota and Brown’s Arlington Honda dealerships in Cherrydale told ARLnow they also have fewer available new and used cars to sell. At Brown’s Honda, around 50 used cars are currently available for sale, whereas 150 to 200 cars would normally be in stock, according to a pre-owned salesman. Prices at the dealership are up between 20% and 45%, in line with used car price increases nationally.
The scarcity of computer chips can be traced back to the beginning stages of the coronavirus.
When lockdowns first went into effect, car sales crashed, leading automobile companies to reduce orders for chips and other parts. Chip manufacturers, in response, cut production in order to avoid financial losses.
The strategy helped chip companies survive the pandemic. As car sales bounced back, however, automobile companies found that there weren’t enough chips for them to maintain the levels of production they wanted, as ramping up chip production can take a long time. Ford Motor Company slashed production by 50%. Meanwhile, Jeep temporarily stopped manufacturing two of its models because it didn’t have the chips needed to make them.
As the supply of cars dwindled, dealerships around the country, including those in Arlington, suffered. At the Mercedes-Benz dealership, Moghisi said that the low supply of both new and used cars has forced the dealership to hike its prices for used cars in order to maintain profitability.
“There are not many new cars around, which really means people are not trading [in] their cars, and therefore, there’s a shortage in the market for premium cars,” Moghisi said.
According to Eddy Malikov, the manager at the used-car dealership Arlington Auto Group, consumer demand is starting to decrease as a result of the rise in prices.
“I think there’s less demand now in the U.S market at least from what our business has seen. We sold around 30 cars in the first two weeks last month. This month we’ve done around 18 vehicles,” Malikov said. “I would say demand might be going down and prices and supply are going back to where they should be.”
For Moghisi, as the shortage stretches on, the stress builds for him and his employees.
“We’ve been playing the waiting game — just have to wait and see what happens. We buy whatever we can get, which is not enough,” Moghisi said. “The way this has affected the industry is, dealerships are making less money, which has put a pressure on employees. If there are no cars to sell, we can’t make a living.”
It could be a while before the automobile industry and car dealerships have fully recovered from the ongoing chip shortage. Intel CEO Patrick Gelsinger told analysts last month that the chip companies may not catch up to demand for another one to two years.
“We hear different stories. We hear it’ll be fixed by November, December, then we hear by next July. We don’t know,” Moghisi said. “I don’t think we’ll have to shut down the department. Eventually, it’ll get fixed, it’s just a matter of time. The only issue is we have to dig into our savings.”
Photo via Google Maps
On a quiet residential street near Arlington Blvd, cars can be heard accelerating as they turn a corner, with their aftermarket exhaust giving off a loud “roar.”
Meanwhile, near Columbia Pike, cars rev up and drag race on S. Columbus Street by Wakefield High School.
“I’m eight stories up — not at street level, so to speak — so maybe you expect the noise to dissipate,” Betsy Thomassen tells ARLnow. “It’s Wednesday, and it’s happened five to six times… it’s just incredibly loud and a nuisance. In my condo, my furniture sometimes vibrates. That’s kind of incredible really.”
According to residents who have spoken to ARLnow, and who’ve posted on social media sites like Facebook and Nextdoor, there been a surge in modified cars speeding through neighborhoods. Some residents say the uptick is particularly bad along the Columbia Pike corridor and in the Clarendon area, and along the highways that crisscross the county.
“Anywhere there’s a corridor, you have high performance cars,” said Clarendon-Courthouse Civic Association President David Cheek, who even compiled a video, below, of modified cars roaring through his neighborhood. “It’s really rude to accelerate in an area with a lot of people, in a loud car, but there’s a ‘do whatever you want’ mentality.”
After nearly a year of receiving more complaints than usual, the County Board is preparing to take a number of steps to mitigate noise in Arlington and enforce noise maximums on cars and motorcycles, according to Board member Takis Karantonis.
One avenue members are pursuing is via the state legislature. The Board aims to have something on their legislative agenda for the next regular session in January, Karantonis said. They’re also looking to train police officers to engage drivers in conversations and get them to change their attitudes.
“I think that the County Board as a whole is interested in a way to enforce and discourage overwhelmingly noisy motoring in Arlington, especially in neighborhoods,” he said.
Diagnosing the problem
A lot of the especially noisy cars are running aftermarket exhaust systems made for racing, Cheek said. He theorizes that with extra time on their hands during the pandemic, more folks got interested in car modifications.
There is an entire, sophisticated industry around these mufflers, but there is very little regulation, Karantonis said, adding that he understands that modified cars sell like hotcakes in motoring and touring fairs.
One reader told ARLnow that the new noise isn’t always associated with higher speeds.
“They often ‘sound’ as though they are also speeding, yet I’ve seen several that are loud, but didn’t appear to be speeding,” one said. “I suspect that those nature of the modifications.”
As a car and motorcycle enthusiast, Cheek said he understands the appeal of modifying a vehicle and wanting to enjoy it.
“I feel for them,” he said. “But they have to understand there are a lot of people who’re upset about it — on Columbia Pike and in Clarendon — and that it’s not fair to everyone else.”
He added that noise pollution “isn’t just annoying — it impacts your mental health, and it actually affects your life.”
Karantonis said there are a few paths on the table, from enacting legislation to educating drivers.
Legislative action will be somewhat tricky, in part because a new state law went into effect in March that says police officers cannot initiate a traffic stop for, among other things, loud mufflers. The code still allows drivers to be ticketed for noise if they were pulled over for a violation such as speeding.
The law, sponsored by Del. Patrick Hope (D-Arlington), was passed to reduce racial disparities in traffic stops, as some police officers historically used pretextual reasons — such as a loud car or expired tags — to pull over residents and search their cars.
Four years ago today, one of the strangest stories in Arlington history played out.
It was a slow Thursday in August when an ARLnow editor was on the phone while walking around Clarendon, where our offices were located at the time. Along Wilson Blvd, next to the Metro station, an odd sight caught his attention: a van with rhythmic blinking lights at the top of the windshield.
As it drove by, there was something missing — a driver.
Quickly the editor apologized to the person on the other end of the phone call, hung up, and took a series of cell phone videos. Published that night, the video would end up making regional and even national news.
“A mysterious, seemingly driverless van was spotted cruising the streets of Arlington’s Courthouse and Clarendon neighborhoods Thursday evening,” we reported that night. “The unmarked gray van with Virginia license plates drove up and down Wilson and Clarendon Blvds more than a half dozen times — with no one in the driver’s seat or passenger seat. The rear windows of the Ford Transit Connect van were darkly tinted.”
“The van appeared to drive cautiously but keep up with traffic. Cameras and a light bar could be seen behind the windshield,” the article continued. “The lack of a driver went mostly unnoticed as Clarendon residents went around their after-work routines near the Metro station, though occasionally people could be seen pointing at the car or asking someone nearby if they saw a driver.”
Arlington County, Arlington County police, VDOT and the Federal Highway Administration told us they had no knowledge of any autonomous vehicle testing in the area. It remained a mystery for several days, with many wondering whether autonomous vehicle technology had advanced to the point where a van could safely drive itself in circles around a densely populated area.
Then, an unexpected revelation and some made-for-TV theatrics helped the story attain even greater fame. NBC 4’s Adam Tuss, after leaving an interview at ARLnow’s offices the following Monday, spotted the van, peered inside and found… arms and legs.
“Brother, who are you? What are you doing? I’m with the news, dude,” Tuss said. “Dude, can you pull over and we can talk for a second?”
— Adam Tuss (@AdamTuss) August 7, 2017
As it turns out, the “driverless” car was actually an experiment run by Virginia Tech and Ford to see how people reacted when they saw a car with no one in the driver’s seat.
In reality, the driver was disguised as a car seat. The university admitted its role after Tuss’ tweet went viral.
Ford said the light bar in the van was intended as a way to communicate the car’s intentions to pedestrians.
“Anyone who has crossed a busy street likely knows the informal language between pedestrians and drivers,” [Ford researcher John] Shutko wrote. “A driver might wave her hand to indicate to the pedestrian it’s okay to cross, or a pedestrian could throw up his hand like a stop sign to signal he plans to cross first. But what happens in the future, when self-driving vehicles operate without drivers - and in some cases, without anyone even in the vehicle itself?”
After being first reported by ARLnow.com, and famously further investigated by NBC4 reporter Adam Tuss — who was startled to discover a person in a seat costume inside — VT admitted it was behind the driverless car.
Ford said people are put in the cars — and dressed as car seats — for safety reasons, as self-driving technology is still in the early stages of testing and development.
And if not for some meddling reporters, the experiment might have been able to continue to roam Arlington streets and startle pedestrians for a bit longer. Without the mystery and the “news dude” moment, however, the story would not have been nearly as memorable.
Temporary bollards and wheel stops along a segment of S. Carlin Springs Road are set to come down this weekend.
Since March, these barriers — closing off the northbound right travel lane from 8th Place S. to 5th Road S. — have been up to give more room to kids walking to their neighborhood schools. On Saturday (July 24), S. Carlin Springs Road will fully reopen to traffic, according to a tweet from Arlington’s Department of Environmental Services.
Based on community feedback and field study, the northbound right travel lane of S Carlin Springs Rd from 8th Pl S to 5th Rd S will reopen to traffic this Saturday. The lane had been used for a temporary pilot walkability route. #VsionZero https://t.co/Lj1Zw8i2MH pic.twitter.com/P0UemcJhzf
— Arlington Department of Environmental Services (@ArlingtonDES) July 22, 2021
“APS and the Department of Environmental Services saw an opportunity to create pilot temporary walking routes not on built sidewalks but rather on space carved out from an original travel or parking lane to help students get to school,” DES spokesman Peter Golkin said.
Campbell Elementary School, Glen Forest Elementary School and Carlin Springs Elementary School are all on or near that stretch of S. Carlin Springs Road that starts in Arlington Mill and ends in Glencarlyn.
The pilot walkability route was part of the county’s five-year Vision Zero Action Plan, aimed at eliminating traffic-related deaths and severe injuries. The County Board approved the Vision Zero safety plan this May.
“Staff collected information on facility use feedback, community experience, field observation of operation, traffic pattern, crash experience, etc.,” Golkin said. “Staff hope to use the comments and data to inform future decisions.”
DES and APS will continue studying how the road is used to decide any future changes to traffic patterns, he said. They also tested out the idea on Lorcom Lane in residential North Arlington, which has seen prior attempts to improve safety for kids walking to school.
Although the test was part of a long-range plan, the department took advantage of conditions this spring — when there were fewer cars on the road due to the pandemic and kids were starting to walk to school again — to pilot the change, Golkin noted.
He says neither the Arlington County Police Department nor APS observed a notable increase or decrease in the number of collisions during the study period. Instead, they saw “challenging and dangerous encounters, but none resulted in a collision.”
A new event in the Virginia Square area, Cars & Coffee, will kick off on Saturday with live music, classic cars and free doughnuts and coffee.
Cars & Coffee will take place in the parking lot of 3901 Fairfax Drive and is being co-hosted by the Ballston Business Improvement District and Skanska Commercial Development. The free event will take place every other Saturday from 8-11 a.m. through Aug. 7.
Local car enthusiasts can register online to display their cars for the show.
Skanska purchased the Fairfax Drive parking lot space in 2019 to convert it into a public plaza and office building. Although the project near Arlington Central Library has been plagued with delays, the company plans to break ground there in the near future.
“At Skanska, we create spaces built to serve communities,” said Mark Carroll, Executive Vice President for Skanska USA Commercial Development’s local office. “We’re looking forward to starting that journey even before we put shovels in the ground here in Ballston.”
Ballston BID CEO Tina Leone shared Carroll’s sentiment, saying she hopes the event will bring people out into the community and allow them to get to know their neighbors.
“It’s encouraging and exciting to see people coming out, supporting local music, local businesses and just generally being a community again,” Leone said. “We have a strong network here in Ballston and we support each other immensely. It’s amazing to see it happening in real-time with events like Cars & Coffee.”
Photos courtesy of Ballston BID
A North Arlington neighborhood is on alert after someone deflated tires on at least five SUVs in the name of environmental justice.
The incident happened after midnight on Friday, June 18, along the 4600 block of 37th Street N. in the Old Glebe neighborhood.
“At approximately 12:45 a.m. on June 18, police were dispatched to the report of a vehicle tampering,” Arlington County Police Department spokeswoman Ashley Savage tells ARLnow. “Upon arrival, it was determined that the victim’s two vehicles, which were parked in their driveway, had air pressure released from the rear driver side tire.”
“Officers canvassed the area and located three additional vehicles with tampered tire pressure,” Savage continued. “A flyer, allegedly left by the ‘Climate Liberation Front,’ was located on the windshield of the involved vehicles. The investigation is ongoing.”
As mentioned on a Nextdoor thread about the tire deflations, the note left on the vehicles (below) was almost identical to that left on SUVs in Sweden in 2007.
We have deflated one or several tyres of your SUV. Don’t take it personally. It’s your car we don’t like. You are certainly aware of the large amount of fuel it consumes. so we don’t have to enlighten you about that. But either you are ignorant of, or you don’t care about the fact that all the gas you consume by driving around in your SUV in the streets of the city has devastating consequences for others.
Scientists are entirely sure that we are very close to pushing climate change over a threshold, into a phase where it will be totally out of control and cause irreversible damage.
When the glaciers melt, people’s source of water disappear. When the deserts spread. agricultural fields become uncultivable. When the sea level rises, homes are inundated. Result: billions of refugees, countless deaths. It’s already estimated that 150,000 people die every year due to the effects of climate change, according to the WHO. As an affluent American you will survive longer then [sic] most. Those most vulnerable, and already worst afflicted by the global warming caused by Northern affluence, are the people of poor countries. In the end, however. climate chaos will affect us all, poor people as well as rich.
This does not have to happen if we impose a radical cut on carbon emissions. Now. Not tomorrow. That’s why we have disarmed your SUV by deflating the tires. Since you live in a city with a functioning and accessible public transportation system you will have no problem going where you want without your SUV.
Climate Liberation Front
@FrontClimate on Twitter
A tweet from the Twitter account of the “Climate Liberation Front,” sent before the tire deflation spree, said the action was “only the beginning.”
“Some new wannabe eco-terror bullsh–,” said a tipster who contacted ARLnow.
Savage said the police department has so far had no other reports of similar incidents. The department encourages anyone whose vehicle has been tampered with to call the Arlington non-emergency line at 703-558-2222 or to file a police report online.
The tire deflations attracted more than two dozen comments on Nextdoor. Some questioned the wisdom of inconveniencing residents as a method of fighting climate change.
“Do they think you’ll just wake up with flat tires and buy a Prius?” one person asked.
A man is facing a battery of charges after police say he jumped on the hood of a stopped car and then assaulted officers.
The incident started around 7:45 p.m. Saturday, at the intersection of N. Glebe Road and N. Quincy Street in the Ballston area.
From Monday’s Arlington County Police Department crime report:
ASSAULT & BATTERY ON POLICE, 2021-05220227, N. Glebe Road at N. Quincy Street. At approximately 7:46 p.m. on May 22, police were dispatched to the report of a destruction of property. Upon arrival, it was determined that the victim was inside his vehicle at a red light when two individuals ran into the intersection. The suspect then allegedly jumped onto the hood of the victim’s vehicle and smashed the windshield. The suspect fled the scene on foot and was located by responding officers at N. Glebe Road and Carlin Springs. As officers attempted to detain the suspect, he became physically combative and spat at them. Following a brief struggle, he was taken into custody. An officer was transported to an area hospital for a minor injury sustained during the struggle. At booking, the suspect complained of a previous injury and was transported to an area hospital for evaluation. While at the hospital, the suspect kicked, scratched and threatened officers. Wade Westmoreland, 37, of No Fixed Address was arrested and charged with Assault on Police (x4), Obstruction of Justice (x2) and Destruction of Property. He was held without bond.
Today’s crime report also includes several items involving thefts of or from vehicles in various parts of North Arlington, including Ballston, Donaldson Run, Williamsburg and Riverwood.
GRAND LARCENY AUTO / VEHICLE TAMPERING / LARCENY FROM AUTO / BURGLARY (series), 2021-05230071 / 05230079 / 05230084 / 05230089 / 05230109 / 05230121, 4300 block of 31st Street N., 3500 block of 25th Street N., 4000 block of 25th Street N., 2700 block of N. Randolph Street, 6400 block of 29th Street N., 3200 block of N. Ohio Street. At approximately 6:02 a.m. on May 23, police were dispatched to the report of vehicle tampering in the 4300 block of 31st Street N. Upon arrival, it was determined that a witness observed two vehicles occupied by four suspects approach the victim’s residence. Two suspects exited and tried the door handles to the vehicles parked in the driveway before fleeing the scene at a high rate of speed. During the course of the investigation, it was determined that the two involved vehicles, a 2018 Ford Expedition bearing VA tags UNX8251 and a 2018 Honda Accord bearing VA tags JDM4288, had previously been stolen from the 3500 block of 25th Street N. and the 4000 block of 25th Street N. While investigating this incident, officers identified six additional vehicles that had been tampered with and rummaged through, but no items were reported stolen. During one of the tamperings, the suspects unsuccessfully attempted to use a key located inside a vehicle to enter the victim’s residence in the 3200 block of N. Ohio Street. Suspect One is described as a Black male with a skinny build, wearing a bright orange reflective vest, a green hoodie, red skinny pants, white shoes, black socks, purple latex gloves and a dark colored mask. Suspect Two is described as a Black male with an athletic build, wearing a black t-shirt, black jeans, black shoes and blue latex gloves. There are no descriptions for Suspect Three and Four. The investigation is ongoing.
Summer School Enrollment Limited — “Despite having offered financial incentives to teachers to teach summer school, there are fewer applicants than the number of students who are eligible for summer instruction at the elementary level, making it impossible for APS to offer summer strengthening support to all eligible elementary students.” [Arlington Public Schools]
Car Driven onto W&OD Trail — “We were riding our triple bike and came across someone who had driven onto the W&OD Trail from Park Rd S… it was rather scary that they barely stopped before we passed by.” [Twitter, YouTube]
New Location for Free Covid Tests — From Arlington County: “Our no-cost, no-appointment mobile COVID-19 testing has moved! It’ll be based in the parking lot of Unitarian Universalist Church (4444 Arlington Blvd) through May 28.” [Twitter]
Dems Prepare for Apartment Outreach — “Voters [in multi-unit buildings] may have tipped the outcome of the 2018 County Board race, in which Democrat Matt de Ferranti ousted independent John Vihstadt… This year, races for local and legislative posts are probably not in much doubt across Arlington. But Democrats are hoping to run up the score in the races for governor, lieutenant governor and attorney general in order to offset Republican strongholds downstate.” [Sun Gazette]
Va. GOP Selects Gov. Nominee — “Former private equity chief Glenn Youngkin became the Republican nominee for Virginia governor Monday night after his closest rival, business executive Pete Snyder, conceded while votes were still being tabulated.” [Washington Post, Associated Press]
Flickr pool photo by Kevin Wolf
Sponsored by Monday Properties and written by ARLnow, Startup Monday is a weekly column that profiles Arlington-based startups, founders, and other local technology news. Monday Properties is proudly featuring 1812 N. Moore Street in Rosslyn.
When Megan Gray was diagnosed with epilepsy at age 23, doctors told her she could never drive again.
She had to get rides from family and friends or hail Uber and Lyft drivers. Forgetting something at the grocery store meant more hassle than returning was worth and calling a car got expensive.
“Becoming epileptic changed my life,” Gray said. “People don’t realize how important driving is until you need it and can no longer do it.”
Rather than give up her independence, however, she decided to create a technology that could help her. Once she did, Gray founded Moment AI, which is developing an artificial intelligence system that can detect, monitor and analyze human health abnormalities that occur on the road.
“Moment AI can change the way drivers drive by providing the vehicle with more knowledge than it ever has had before about the driver’s health,” she said. “Our algorithms are made to adapt to the unique drivers in the U.S. Our goal is to provide more access to driving to people who have disorders.”
Gray tinkered in her 500-square foot apartment with technology she bought from Amazon using money she made playing poker. Her circle of epileptic friends tested out her technology along the way.
Once she established her company and brought on a co-founder, Gray said investors took notice. Within a year, SoftBank — the multinational Japanese company that runs the world’s largest venture capital fund (and famously invested big in WeWork) — backed her.
Another high-profile investor is Nvidia Corporation, which helped to develop the AI technology in Tesla vehicles.
And now, Moment AI is partnering with Samer Hamdar, an associate professor of civil and environmental engineering at the George Washington University, to create a prototype of an in-vehicle AI system that could detect the start of a health problem, take control of the car and guide the car and driver safely to the side of the road.
“Mobility and certain core services should be available to all people, including those with health problems and demanding work environments,” Hamdar said in a press release. “Moment AI is a special project: it showcases the need for transportation equity and builds on a personal story to launch an academic-industry partnership that may have a significant impact on the lives of many in need.”
Now, Gray and her team have access to vehicles, simulators and graduate students to develop this potentially life-saving tech. Hamdar and his team will use driving simulators to create images and videos to train AI systems to predict and detect fatigue, seizures, strokes and heart attacks.
“We literally went from my living room to a WeWork in Arlington and now, a research lab in D.C.,” she said. “It has been pretty fast-paced.” Moment AI is headquartered at the WeWork in Rosslyn, after moving from the Crystal City WeWork, which recently closed.
Gray is also working on a way to get the tech into existing cars for those who cannot afford a new car with built-in AI.
The founder and CEO is the first woman and first African American to partner with the GWU transportation lab. In addition to breaking down such barriers, she is particularly proud that a record number of graduate candidates applied to work on her project with Hamdar.
County Offering New Walk-Up COVID Testing — “Arlington County is launching a mobile, no-cost to patients, walk-up testing service in partnership with Quest Diagnostics. The mobile testing command center will open Tuesday, March 9, at 1429 N. Quincy Street, replacing the current drive-through testing site at that location. It will operate at that location for two weeks, Monday-Friday from 9 A.M – 4 P.M. Then it will move to new locations on a two to three-week rotational basis to offer walk-up COVID-19 testing throughout the County.” [Arlington County]
BID: National Landing is ‘Over-Parked’ — “Right now, we’re over-parked. We [were] originally built during a period that prized the automobile, but we were also fortunate enough to grow into a Metro system, and a number of other modes opened up possibilities for growth and development that are truly sustainable. What we’re seeing with new development is a ticking down of parking requirements. So we are focused on being a transit-oriented community, a multimodal community. The future is not cars.” [Smart Cities Dive]
County to Extend Ground Lease on Its HQ — “Arlington County and JBG Smith (JBGS) have entered into a letter of intent to restructure the ground leases of 2100/2200 and 2300 Clarendon Boulevard and the theater parcel in the Courthouse Plaza complex. The County owns the land under these three properties while JBGS owns the buildings. The LOI agreement states the County will provide JBGS the option to extend the leases from the current expiration in 2062 to 2119. Under the current leases, annual rent paid by JBGS to the County has varied significantly, ranging from $100,000 to $3.9 million. The new agreement would modify the annual lease payments to fixed rates and will include a one-time lump sum of $18 million paid by JBG Smith upon execution of the leases.” [Arlington County]
Sponsored by Monday Properties and written by ARLnow, Startup Monday is a weekly column that profiles Arlington-based startups, founders, and other local technology news. Monday Properties is proudly featuring Shirlington Gateway. The new 2800 Shirlington recently delivered a brand-new lobby and upgraded fitness center, and is adding spec suites with bright open plans and modern finishes. Experience a prime location and enjoy being steps from Shirlington Village.
The funding announcement comes after a year of gains for the four-year-old company, CEO Kevin Bennett tells ARLnow. In 2020, MotoRefi — based at 1010 N. Glebe Road in Ballston — raised $9.4 million, saw the number of users on its platform double and saw its revenue grow six times over. It facilitated over $250 million in auto refinancings and brought on an additional 100 employees.
(Bennett said MotoRefi does not release the number of users.)
The company, which was created by a team of venture-builders from Alexandria-based QED Investors, matches drivers looking to refinance their auto loans with credit unions and community banks. Bennett, who has worked on four other D.C.-area startups, said QED Investors co-founder and managing partner Nigel Morris asked him to lead the fledgling startup.
“Most consumers don’t know they can refinance their cars,” he said, contrasting it with a more commonly-understood home refinancing. “Only 47% know they can refinance their car and 2 to 3% do it.”
And unlike refinancing a home and or some student loans, where online platforms such as Rocket Mortgage and SoFi have made the process easier and more transparent, Bennett said this part of the market has not had its “Rocket Mortgage moment.” MotoRefi changes that, he said.
“People rightly don’t see the process as laid-out fairly,” he said. “One of the things that’s attractive about this startup is that it has a real very specific impact on people’s lives. We see the results of our work every day and that’s incredibly motivating.”
The startup handles the refinancing process from soup to nuts, checking credit scores and matching users only with the rates from banks and credit unions that they qualify for, Bennett said. The average customer saves about $100 a month.
For the smaller credit unions and banks that MotoRefi partners with, Bennett said the startup provides them access to customers they would not otherwise be able to reach. The startup also smoothes out the onboarding of new customers by streamlining the process of gathering documents and matching people with companies based on whether they would be approved, he said.
“We’re more efficient than our competitors because we’re the first real tech company in the space,” he said. “Our approval rates are higher, and it’s much less work for that credit union to review and fund a loan since we’re only sending customers who we know are a match.”
MotoRefi’s revenue comes from a number of different streams, Bennett said. The startup charges customers a processing fee in their loan and lenders pay MotoRefi for access to the people seeking loans, he said. The company also sells car-related services like a gap warranty.
Photo courtesy MotoRefi